Mirae Asset Securities

Transcription

1 Mirae Asset Securities Investor presentation Q2 FY29 Company fiscal year starts in April

2 1 Disclaimer This presentation may contain forward-looking statements about Mirae Asset Securities and unaudited preliminary figures internally collected as of September 29. These figures are subject to change without prior notice, and Mirae Asset Securities is neither obligated to provide revisions, nor responsible for any loss or inconvenience caused by changes regarding the projection and forecast presented in this document.

3 2 Table of contents I. Industry overview 3 II. Company overview 9 III. Company operational overview IV. Group overview Appendix

4 3 I. Industry overview I. Asset management industry Stock market II. III. Retail investors vs. Institution investors

5 4 I. Asset management industry Despite global recession, the systematic investment plan continued to inject liquidity into the market thus offsetting redemptions. Asset management industry Stock fund market Mirae Asset Investments KrW Trillion MMF 채권형 Fixed income fund 혼합형 Balanced fund 주식형 Stock fund % 38% 26% 31% 25% 21% 22% 1% % 12% 23% 15% 21% 19% 5% 38% KrW Trillion 16 시장 Domestic 국내주식형 CAGR : 22% 시장 Overseas 해외주식형 CAGR : 75% Portion of systematic investment plan 12 27% 1 16% 11% 46% % KrW Trillion 미래에셋 Domestic 국내CAGR 주식형: 27% 미래에셋 Overseas 해외CAGR 주식형: 87% Portion of systematic investment plan 47 52% Source : KOFIA, excludes PEF, REITs and etc.

6 I. Asset management industry Despite of the global financial crisis, the long-term trend of money shift from saving to investments is still in tact. Domestic equity funds net subscription Overseas equity funds net subscription KrW Trillion 7, (KRW b) 7 5,5 3, 3 1,1-1, Mirae Asset Group Others Industry Source: KOFIA accumulative -3, Feb-8Apr-8 Jun-8Aug-8Oct-8Dec-8Feb-9Apr-9 Jun-9Aug-9 AM industry vs. Bank time deposits KrW Trillion 2, 2 1, , Mirae Asset Group Others Industry , -1, , -2 Source: KOFIA accumulative Feb-8Apr-8Jun-8Aug-8Oct-8Dec-8Feb-9Apr-9Jun-9Aug-9 Expected return from equity KrW Trillion 4, 3, (A) Balance of time deposit (B) AUM by asset managers (A)/[(A)+(B)] % 7 6 % Expected return from equity Bank deposit interest rate Positive for equity 2, 1, Positive for deposit Source: Bank of Korea, KOFIA, Company report 5 Source: IBES, Bloomberg Note : Expected return on equity = 1/ MSCI Korea forward P/E=*1

7 II. Stock market The daily trading volume has maintained steady level above 7 trillion KrW range brokerage sector continuing to out-perform the banking sector KrW Trillion 13 주식형 Equity fund net inflow KOSP Index Source : KOFIA, KRX Stock fund net in-flow KOSPI financials sector performance (pts) 2, , 1,5 1, 5 KrW Trillion KOSPI Daily trading volume 5.7 KOSDAQ Source : KOFIA, KRX Daily trading volume (%) Source : KRX Brokerage Bank Insurance Others Retail Foreign institution Domestic institution Source : KRX

8 7 III. Retail investors vs. Institution investors Investment return for retail investors who redeemed their shares in fixed-income balanced fund to invest in direct equity has recorded an average of 15% for the first half of this year, greatly lagging the indices and institutional investors due to their over weight in defensive sector Investor performance YTD (1H9) 52% 76% Retail Top buys - 22 out of 5 stocks recorded loss - Only 17 out of 5 outperformed the indices - Top buys were: KT, SKT, KOGAS, KT&G, CJ, Hanjin Shipping, KEPCO, Korean Air Fund performance (YTD) 48% 49% 54% 15% 24% 28% Domestic Institution top buys - 2 stocks recorded loss - 42 stocks out of 5 outperformed the indices - Top buys were: Samsung Electric, 15% 26% Samsung SDI, LG Electric, LG Display, KIA Motors, Retail Investor KOSPI Foreign KOSDAQDomestic Institution Institution Tong Yang Securities, HMC IB, Daegu Bank, Dongbu Insurance Balanced (FI) Balanced (Eq) KOSPI Equity fund KOSDAQ Source : KRX Source : Zeroin (As of Oct 16 th )

9 Ⅳ. Investor survey To me, mutual fund is Korean retail fund investors are still showing optimism, despite of significant losses in their mutual fund assets. According to a recent internet survey which asked how they think of their mutual fund investments, 9% of the participants answered with positive attitudes. (Unit: people) 2, 1,8 1,6 1,4 32.1% 29.9% 1,2 1, 15.8% % 3.7% 3.3% - hopes, patience that investment longterm value investing essential tool dreams pays off =Mutual Fund investment tool for WM & turst Source: e-daily, KIH 8

10 9 II. Company overview I. Diversified revenue & superior return Outstanding growth II. III. Managing growth and cost IV. Growth initiatives

11 1 I. Diversified revenue & superior return The Company s core strength lies in the advanced and balanced revenue model Net revenue comparison EBT growth (3 yr.) Korea top 5 firm s average Mirae Asset Securities % 36% 48% 47% 34% 26% 3% 2% % -2% Mirae Asset Securities S D W H Brokerage Wealth management Investment banking Interest profit & other Trading income & PI 12% 14% 43% -16% 36% 3% 31% 2% 8% 3% 11% 1% 18% 14% 19% 31% 12% 1% 9% 1% -4% ROE MAS Mirae Asset Industry (Unit : %) Securities

12 II. Outstanding growth The Company s core strength lies in the wealth management and institutional brokerage business Wealth management Brokerage (equity) KrW Billion 12 KrW Billion % KrW Billion 4 3 Investment banking KrW Billion 4 3 Interest profit Excl. PI profits 11

13 III. Managing growth and cost On the back of stable revenue in the wealth management and institutional brokerage business, the Company has been able to realize the economies of scale while managing costs efficiently during market down turn Revenue growth vs. cost EBT growth KrW Billion Revenue Cost KrW Billion Channel strategy Expand branch network Strengthen fee base & On-line New business CMA & OTC products Overseas brokerage HNWI platform H FY9 Annualized Globalization & IB HK/Vietnam/UK/US/India/Brazil Fee based IB business Note: Excl. OTC trading gain/loss 12

14 IV. Growth initiatives Recently, the Company has strategically restructured local branches to promote HNWI Platform business to accelerate the growth of assets in relation to the settlement business Channel strategy Flexible branch network Strengthen fee base & on-line New business CMA & OTC products Overseas brokerage HNWI platform Globalization & IB HK/Vietnam/UK/USA/India/Brazil Fee based IB business Company s WUM(Fund) # of branches # of CMA accounts (in Mn) Krw Trillion Mirae Asset Securities S K D H W Vietnam Brazil & Others Mirae Asset Securities Hong Kong China UK US

15 14 III. Company operational overview I. Wealth management Brokerage II. III. Investment banking IV. Corporate pension

16 15 I. Wealth management Despite global bear market, the Company s WUM has endured relatively well since 28 while continuing to expand market share in SIP Wealth under management (WUM) Other wealth management biz KRW Billion 24,47 24,228 23,165 22,969 Trust Wrap account CMA Advisory Fund sales balance (as of September 29) 38 Trillion 1% % Other MMF Balanced fund Fixed-Income fund Domestic stock fund Overseas stock fund Other : PEF, REIT etc. 14,656 4, ,53 1,341 1,876 7,88 7,385 8,553 8,66 8,274 7,811 36% 4,494 4,7 5,923 3,114 8,95 8,862 7,2 6,496 2,799 3,119 4,733 28% , ,22 1,558 2, Industry (mn) Company M/S 3.1% # of SIP account 4.3% % 6.2% %

17 II. Brokerage Despite the drop in brokerage M/S due to our strong mix in institutional biz, brokerage commission have managed to grow CAGR 19% over the past years Brokerage M/S (FY28) Brokerage breakdown Brokerage M/S Trading value Commissions 8.2% 8.4% 5.1% 5.7% 5.6% 6.5% 8.5% 33% 1% 66% 23% Institution % 77% Off-Line (Retail) 48% 8% 45% 1% 13% % 87% 5.9% % 27.9 Average fee % On-Line (Retail) 43% 45% Channel (bps) FY 6 FY 7 FY 8 1H 9 Off-line wholesale H W S D1 Mirae Asset Securities Source : Data from each company Top 3 average Note : Top 3 (S, D, W) On-line retail

18 III. Investment banking The Company s investment banking group focuses on generating stable cash flow through specializing on advisory and fee based business IB revenue Structured products KrW Billion 4 Trust Underwriting Structured securities 3 Advisory fee 2 1 KrW Billion Prop. trading Equity Fixed income Beneficiary certificates Structured product, Future future & Option & option Stock warrants Negotiable commercial papers paper - KrW Billion.5% %.9%.6% % 1.2% % Interest income 1.2% 1.3% 1.% % 5% 5% 4% 14% 14% 14% 13% 1% 2% 8% 3% 5% 6% 9% 12% 16% 22% 27% 29% 36% 34% 28% 29% ELS new issuance Commission rate Margin loan Loan Bank deposit & Others Fixed-income -5 62% 59% 54% 54% 52% 55% 58% 53%

19 IV. Corporate pension The Company s corporate pension group has been able to become the #1 DC provider expanding market share by providing differentiated consulting services to clients Corporate pension M/S Plan performance KrW Trillion Insurance Securities Bank M/S 9.1 < DC > 9 Company s M/S 26.9% (RHS) 3% % % % 2% < DB > Source: FSS, Company AUM & Plan type mix 52% 1% Mirae Asset Securities Bank Securities Insurance Source: FSS (Jan 26 ~ Sep. 29) Mirae Bank Asset Securities Securities Insurance Korea's expected CP market size as % of GDP 2% 1% 8% 2% 11% 39% 51% 1% 1% 9% 87% 29% 17% 51% 7% SecuritiesInsurance Bank Source: FSS (as of Sep, 29) Others Indirect investments Insurance products Bond Bank time deposits Portion of DC KrW Trillion % 2% 3% 5% 86 8% % 25 22% 29 21(E) 211(E) 212(E) 213(E) 214(E) 215(E) 1% 75% 5% 25% Note: Based on KIRI's 215 estimate of 25 tn KrW and applying CAGR of 71% from 29 to 215 CAGR 3% GDP growth assumption applied from 29 to %

20 IV. Corporate pension Corporate pension market is poised to grow rapidly due to Korea s fast aging demographics and the government s need to manage high longevity risks 2% 14% 7% 1) Post-aged society Aged society Aging society Aging/Aged/Post-aged society 1932 Germany Japan yrs Korea 8yrs 26yrs ) It is classified as 'post-aged society' when more than 2% of the population is consisted of people with age 65 or more Corporate pension market as % of GDP Aging problem The aged Productive population Trend of USA CP market as % of GDP 15% 1% 5% 79% 116% 123% 82% 125% 1% 75% 5% 51% 86% 17% 116% %.6% 25% % Korea UK USA Netherlands OECD Ave Source: KIRI, HRI, PRIMA (27 for USA, 28 for others) 19 Source : PRIMA

21 2 IV. Group overview I. Innovator in Korea capital market Mirae Asset Group structure II. III. Mirae Asset Investments AUM

22 I. Innovator in Korea capital market Mirae Asset is an innovator of Korea s capital market bring new paradigm shifts through its unique First-See & First-In strategy Korea s first mutual fund First Wrap Account & Monthly Savings Plan First REITs & PEF First Global AMC First overseas fund First Retirement Annuity Institute First Biz Unit System First to establish a subsidiary in Vietnam Overseas expansion to UK, USA, Brazil, China Leading the market with Alternative Investments Variable Insurance Overseas Expansion Create the market for Monthly Savings Plans Wrap Account REITs PEF Corporate Pension Opened the era of Asset Management Industry Mutual Fund Monthly Savings Plan Overseas Fund 21

23 22 II. Mirae Asset Group structure Mirae Asset was established in Since then, the group have become one of Asia s leading money managers* based on our full range of financial services Mirae Asset Securities Investment banking Wealth management Brokerage service Retirement pension Mirae Asset Life Insurance Life insurance Variable insurance Retirement pension U.S.A U.K. Vietnam Brazil Korea Hong Kong Securities Life Insurance Korea Mirae Asset Financial Group Capital & Venture Korea Asset Management Hong Kong India U.S.A. U.K. Vietnam Mirae Asset Global Investments Traditional long only equity Mirae Asset Maps Global Investments Alternative investments (PEF, REITs) Korea Brazil Mirae Asset Capital & Venture M&A Advisory service Investment in start-up companies * Mirae Asset Financial Group s Total AUM ranked 6 th largest in Korea and 15 th largest in Asia ex Japan in 28 Institutional Investor Asia s 1 Top money manager 28. Asian Investor, Hong Kong based monthly magazine publisher that specializes in Asian asset management industry, awarded annual Asian Investor 29 Investment Performance Award in May 29. Mirae Asset Global Investments won both the best Emerging Market Equity and Korea Onshore Fund House awards this year.

24 23 III. Mirae Asset Investments AUM Mirae Asset investment arm continues to lead the asset management industry with improved market share through timely product offerings and superior fund performance Asset management Industry Stock fund market Stock fund return & M/S KrW Trillion Market CAGR : 15% Mirae Asset CAGR : 65% M/S 18.5% KrW Trillion Market CAGR : 78% 5 Mirae Asset CAGR : 11% 47 M/S 35.9% Unit : % 1 M 3 M 6 M 1 Yr Independence Discovery Dream Target Insight China AP Consumer KOSPI KOSDAQ MSCI AP (ex Japan) Unit: Krw tn AUM Mirae Asset % 18.% 17.6% S ITC % 15.5% 15.7% SH BNP % 7.8% 8.1% Source: KOFIA Source: KOFIA Source : KOFIA (As of September, 29)

25 24 Appendix I. Summary income statement Summary balance sheet II. III. Mutual fund fee structure

26 I. Income statement Fiscal year ends March FY29 FY28 FY27 FY28 (Unit: Billion KrW) Q2 Q1 Q4 Q3 Q2 Q1 Q4 Q3 Q2 Q1 FY27 FY26 Operating Income , , Net Revenue (Operating Profit + G&A Expense) ) Wealth Management ) Brokerage ) Investment Banking ) Net Interest Profit & Other ) Trading Income & Principal Investments (12.4) (.7) 18.2 (17.8) 6.5 (21.1) Operating Expense , , General and Administrative Expense ) Salary Expense ) Marketing Expense ) Fixed Expense ) Other Expense Salary as % of G&A Expense 54% 7% 58% 47% 58% 59% 64% 65% 56% 6% 66% 62% 59% Marketing Expense as % of G&A Exp. 8% 4% 7% 9% 8% 6% 7% 13% 16% 7% 8% 12% 16% Fixed Expenses as % of G&A Expense 16% 13% 16% 18% 17% 15% 14% 1% 13% 11% 1% 11% 11% Operating Profit Non-Operating Income (.) Non-Operating Expense Net Income Before Tax Net Income

27 26 II. Balance sheet FY29 FY28 FY27 FY28 (In KrW billions) Q2 Q1 Q4 Q3 Q2 Q1 Q4 Q3 Q2 Q1 FY26 Total asset 8,61.2 7,82.1 6,67.2 6,67.2 6,4.9 6, ,27.8 6, , ,49.3 5, , Cash and deposit 1,69.3 1, ,21.1 1,21.1 1,3.8 1,25.5 1, , ,453. 1,28.7 1, Securities 5,16.7 4,69.2 4,61.7 4,61.7 4,34.5 4,424. 4,88.9 4, ,56.4 3,89.5 3,268. 2, Derivatives Loans Tangible fixed asset Other assets Total liabilities 6, , , , ,4.9 5, , , , ,42. 4, , Deposit liabilities 1, , , Leveraged liabilities 4, , , , ,43. 3, ,97.2 4, , , ,18.2 2, Other liabilities Total stockholders' equity 1,71.6 1,76.2 1, , ,64. 1,63.9 1, , , ,88.3 1, Capital stock Capital surplus Accumulated other comprehensive income (42.4) (15.3) (18.5) (.3) (.2) (.1) 4. Retained earning Total liabilities & stockholders' equity 8,61.2 7,82.1 6,67.2 6,67.2 6,4.9 6, ,27.8 6, ,368. 6,49.3 5, ,915.2 Note: Current and historical numbers are based on pr-audit results provided for investors convenience.

28 27 III. Mutual fund fee structure Industry Mutual fund fee structure MAS Mutual fund fee structure MAS WM fee(recurring Vs. one-time) 3. Management fee (LHS%) Distribution fee (LHS%) Distribution portion (RHS%) 3. 7% Other (%) Management Fee (%) Recurring distrigution fee (%) KrW Billion One-time fee WM fees (Recurring) One-time fee portion (RHS) 1% 75% % 1. 5% 4% Eq Dom Over Glb Eq Eq. Hyb Bond MMFREITs Ave % 25% % -25% -5% (Inde)(Chi) (Insi) Note 3: Weighted average Note 1: Mirae Asset Securities average 1) Balanced: Mirae Asset independence hanareum balanced 2) Bond: Mirae Asst Solomon government & public bond 1 3) MMF: Mirae Asset New MMF A-4 4) REITs: Mirae Asset Maps frontier real estate 4 Note 2: One-time: MF's upfront fee, structure product issuance fees Total WM fees: MF's recurring portion, WRAP, Bancassurance, trust and etc. Source: KOFIA, Industry weighted average Source: Company, Simple average Source: Company

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